role of sustainable procurement … target population for this study comprised of staff at kenya...

© Wangia, Namusonge ISSN 2412-0294 1583

http://www.ijssit.com Vol III Issue II, May 2017

ISSN 2412-0294

ROLE OF SUSTAINABLE PROCUREMENT PRACTICES ON CORPORATE

GOVERNANCE IN THE KENYAN PUBLIC TRANSPORT SECTOR: A CASE OF

KENYA PORTS AUTHORITY

1* Justus Wangia Wechuli

Jomo Kenyatta University of Agriculture and Technology

[email protected]

2** Dr. Namusonge Sammy Odari

Jomo Kenyatta University of Agriculture and Technology

[email protected]

Abstract

The main purpose of the study was to examine the role sustainable procurement practices play

on corporate governance in the Kenyan public transport sector organizations. The study used a

case study research design. The study used Kenya Ports Authority based in Mombasa County as

a case study. The target population for this study comprised of staff at Kenya Ports Authority

(KPA) headquarters in Mombasa County and precisely from Procurement, Finance, ICT,

Operations, Human Resources and the Transport Departments and analyzed using SPSS. The

study adopted a stratified random sampling technique when selecting the sample, with a sample

size of 84 employees from afore mentioned departments at KPA. Data was collected mainly

through questionnaires. A descriptive statistics were used in this study supported by Statistical

Package for Social Sciences (SPSS) version 21 to compute respondents’ answers in percentages

form. The study equally applied inferential statistics by using multiple regression as well as

correlation analysis to determine the relationship that exists between the research variables.

ANOVA test was applied in the study to establish the statistical significance of the type of

relationship that exists between the variables. The study revealed that sustainable procurement

practices statistically significantly predicted corporate governance in Kenyan public sector

organizations’, F (4,61) = 490.899, p < .05, R2.= .97. The study recommends that the legislature

should come up with laws to administrate sustainable procurement and they need to be enforced

to improve compliance.

Keywords: Sustainable Procurement, Corporate Governance, Supply Chain Management,

Ecological Footprint, Transparency, Sustainability, Environmental Management

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1. INTRODUCTION

Based on Public Procurement and Asset

Disposal Act (2015), procurement is defined as

the acquisition through lease, hire purchase,

purchase, rental, franchise, tenancy, license, or

through some other contractual ways works,

services, assets, or goods comprising of

livestock or any form permutation that

includes advisory, processing, and planning

within supply chain system.

Governments spend between 12% to 30% of

their GDP buying goods, services and

infrastructure, goods and services typically

account for 10-15% of GDP for developed

countries and as much as 25-30% for

developing countries (OECD, 2011). This

clearly indicates the power of the public purse

as an enabler in ensuring markets transition

towards a greener economy. It is important to

note however, that the current world

consumption and production levels are

estimated to be 25 percent higher than the

capacity that can be sustained by the world

(Schaefer et al., 2006).

According to The Sustainable Procurement

Taskforce National Action Plan (2007),

sustainable procurement is known as

investment and purchasing process that focuses

on environmental, economic, and social effects

of an organization’s expenditure. Sustainable

procurement gives organizations the opportunity

to satisfy their wants for services, goods,

construction activities, as well as utilities to

attain the money value on a entire life basis by

generating positive results to the firms as well as

the society and the economy, while at the same

time being within the environment’s carrying

capacity (DEFRA, 2006).

The sustainability concept can be argued as the

first to emerge in the conventional conversation

that took place in 1972, all through the United

Nations Conference that was on the Human

Environment. When severe environmental

issues were being discussed with regard to

industrial development as well as practices on

various issues, which included pollution,

deforestation, and using poisonous pesticides

(CIPS, 2013).

The 1992 Rio Declaration on Environment and

Development refined these ideas and it is where

social justice together with the human rights

issues like peace, poverty, child labour, the role

of women and the plight of indigenous peoples

were overtly included in the combination. The

three dimensional perspective of sustainability,

which include economic, social, and

environmental subsequently was extensively

practiced, and by 1997, the term “triple bottom

line (TBL),” was created by renowned John

Elkington to emphasize the need for

organizations and nations to determine

performance level in the3 dimensional

perspective (CIPS,2013)

Most people consider sustainability to be the

efforts being put to reduce carbon footprint,

harmonized by minimizing waste as well as

water conservation through communication,

innovation, along with best practices.

Sustainability, from the businesses perspective,

means taking part in business with the aim of

meeting human needs without necessarily

degrading the environment, depleting resources,

and without compromising efforts put to

conserve nature. In this study, the terms

‘sustainable’ together with ‘green’ is


interchangeably used as also used by Van den

Broek, 2010).

2. STATEMENT OF THE PROBLEM

Sustainability remains to be an emerging

business mega trend that is continues to create

elemental shift in the competitive landscape as

pointed out in the by Lubin and Esty (2010) and

it is becoming an essential driver of innovation

at a very fast rate (Nidumoluet al., 2009).

Consequently, all businesses that deal with

supply chain are taking into consideration the

espousal of an assortment of sustainability

initiatives with the aim of achieving competitive

advantage, or as a minimum maintaining a

competitive parity.

Transport sector in Kenya is a very vital sector

since it facilitates most of the other sectors. The

sector is made up of road, railway, pipeline, air,

and maritime sub sectors. Kenya Ports

Authority being one of the maritime transport

sub sector is a state corporation with the

responsibility to operate, maintain, regulate and

improve all scheduled seaports on the Indian

Ocean coastline of Kenya. Container traffic

throughput at KPA has been on the rise and

grew by 11.6 percent from 894,000 Twenty

Foot Equivalent Units (TEU) in 2013 to 1.012

million Twenty Foot Equivalent Units (TEU) in

2014 (KNBS, 2015).

Despite the generally strong growth recorded in

the last couple of years, the port is operationally

inefficient by international standards. The port

has therefore embarked on several

infrastructural expansion projects in order to

increase its capacity. Infrastructure is crucial for

enhancing economic progress and poverty

reduction. Equally, the choices regarding type as

well as scale of infrastructure investment have

significant repercussions for environmental

sustainability. Furthermore, infrastructure

expansion has been done at the expense of the

environment and it complicates responses to the

longer-term challenge of climate change. Such

observations highlight the complexity in

building, planning, as well as maintaining

infrastructure for socio-economic progress

together with the environmental sustainability

(Kidere, n.d., Para.11 ).

Kenya ports authority faces a myriad of

corporate governance challenges, which needs

to be addressed. President of the Republic of

Kenya, Uhuru Kenyatta when launching the first

phase of the second container terminal at KPA

asserted, “The biggest threat for Mombasa port

is cargo theft and illegal trade.” He said, “Some

employees of the Kenya Ports Authority (KPA),

Kenya Revenue Authority KRA, and police

were colluding with unscrupulous businessmen

to steal cargo from the port.” Recently, more

than 15 people including KRA, KPA, Kenya

Bureau of Standards (KEBS) workers, and a

clearing agent were charged in Mombasa in

connection to the disappearance of containers

and alleged tax evasion (Sanga, 2016).

It is in light of these realizations that this

research proposal paper tries to explore the role

of sustainable procurement practices on

corporate governance in the Kenyan public

Transport sector. This research is intended to

bridge the existing knowledge gap by carrying

out a survey on public transport sector

organization in Mombasa with KPA as a case

study so as to establish the extent of

sustainable procurement practices adoption

with an effort to enhance good corporate

governance.

3. OBJECTIVES OF THE STUDY


The general objective of this study was to

explore the role of sustainable procurement

practices on corporate governance in the

Kenyan public transport sector. Specific

objectives of this study are as follows;

i) To determine the role of corporate social

responsibility on corporate governance

in the Kenyan transport sector

organizations.

ii) To establish the role of environmental

purchasing on corporate governance in

the Kenyan public transport sector

organizations.

iii) To establish the role of responsible

procurement on corporate governance in


organizations.

iv) To determine the role of technology on

corporate governance in the Kenyan

public transport sector organizations.

4. THEORECTICAL BACKGROUND

This section consists of theoretical orientation

and relevant empirical review obtained from

previous studies. The study was carried out to

analyze the role sustainable procurement

practices on corporate governance in Kenyan

public sector organizations.

4.1 Ecological Modernization Theory

According to Spaargaren and Mol (1992),

ecological modernization theory (EMT) is

founded in sociological theory before being

developed into policy as well as organizational

theories. As a methodical eco-innovation

theory, EMT is inclined in the realization of

industrial development along with

environmental protection through

technological development, innovation, and

modernity as pointed out by Janicke, (2008),

Murphy alongside Gouldson (2000). As for

Murphy (2000), EMT is extensively used when

explaining government environmental planning

along with the reorganization of production by

the dominant manufacturers.

4.2 Sustainable Development Theory

Jenkins (2008) argues that sustainability ideas

became public after 1972 details, “Limits to

Growth,” which was the done by the

international think tank Club of Rome. On the

other hand, World Conservation Strategy coined

by the International Union for Conservation of

Nature while collaborating with the U.N.

Environment Program together with the World

Wildlife Foundation, tried to ensure that

sustainability becomes a yardstick of

international practices in the years of 1980.

Theories of sustainability are considered efforts

being put to integrate or prioritize social

reactions to cultural and environmental issues.

Economic model thinks of ways of sustaining

financial capital and nature: an ecological model

consider diversity in biological and ecological

veracity; whereas political model considers to

social systems that understand human dignity.

Religion has become part of the debate with

critical, symbolic, and motivational resources

required for cultural change.

4.3 Principal Agent Theory

Agency relationship as defined by Jensen and

Meckling (1976) is “a contract under which one

or more persons (principals) engage another

person (the agent) to perform some service on

their behalf which involves delegating some

decision-making authority to the agent.” In most

cases, agency theory is useful in public

contracting. According to Eisenhardt (1989),

situations happen in cases where considerable

conflict of interest occurs between principals


and agents, and adequate result uncertainty to

prompt the risk insinuations of the theory. It is

mostly related to public procurement practices

because staff could be having incompatible

interests differing with the outlined procedures

consequently distressing the application of

green procurement as advocated in the 2009

Public Procurement Policy.

Conceptual Framework

Independent Variables Dependent Variable

Fig 1: Conceptual framework

5. RESEARCH METHODOLOGY

The study adopted a case study research

design. A case study is known to be an

empirical inquiry that “investigates a

contemporary phenomenon within its real-life

context especially when the boundaries

between phenomenon and context are not

clearly evident” (Yin, 2003). The target

population of interest in this research work

consisted of 510 staff members at Kenya Ports

Authority (KPA) headquarters in Mombasa

County and precisely from Procurement,

Finance, ICT, Operations, Human Resources,

and the Transport Departments. Using

Nassiuma (2001) formula, with a confidence

level of 95%, coefficient of variation of 0.5

and precision level of 5%, the sample size of

84 employees was selected. The study adopted

a stratified random sampling technique in

selecting the sample. Both quantitative and

qualitative data were collected in this study.

Corporate Social Responsibility

Legal Responsibility

Economic Responsibility

Philanthropic Responsibility

Ethical Responsibility

Environmental Purchasing

Life cycle Approach

Design for Environment

Innovation

Environmental Management System

Responsible Procurement

Relationship with Suppliers

Support for SME’s

Respect for Human and Labour Rights

Clear and Timely Communication

Technology

SCM Systems

Technological innovation

E-procurement

Corporate Governance

Risk Management

Relationship with Stakeholders

Creation of Shareholders wealth

Legal and Regulatory framework


Data was collected mainly through

questionnaires. The questionnaires used in this

study comprised of open and close-ended

questions. The study also used secondary

sources of information such as published

reports, articles, and journals.

6. RESEARCH FINDINGS AND

DISCUSSION

The study sought to investigate the role of

sustainable procurement practices on corporate

governance in the Kenyan public transport

sector. Specifically the study looked at

corporate social responsibility aspects,

environmental purchasing aspects, responsible

procurement aspects, and use of technology in

procurement. This chapter presents the

empirical findings as well as the results of the

application of the variables using Kenya Ports

Authority as a case study. Data was analyzed,

results interpreted based on the overall

objectives of the study.

6.1 Pilot Study Results

Pilot study conducted to pretest the tool for

data collection for validity and reliability.The

validity of the questionnaires was determined

through a method known as construct validity

method. Construct validity on the other hand

can be defined as the degree to which test

measures the intended hypothetical construct

(Mugenda, 2003).

The study dealt with different groups of

experts in procurement field and issued them

with the questionnaires. The experts were

required to evaluate if the questionnaires helps

in determining the role of sustainable

procurement practices on corporate

governance in Kenyan public transport sector.

The recommendations from the procurement

management experts were used to improve on

data collection instruments.

In assessing reliability of the instruments used

to conduct this study, test-retest reliability

method was used. Eight questionnaires were

administered in six different departments at

KPA at two different times within an interval

of one week. A test-retest correlation flanked

by the two sets of scores was computed. This

was characteristically done by graphing the

data in a scatterplot and computing Pearson’s r

coefficient. The correlation coefficient

between two sets of scores of eight employees

at KPA in six different departments

administered two times, a week apart was

+.95. Generally, a test-retest correlation of

+.80 or greater is believed to indicate good

reliability.

6.2 Descriptive Analysis

6.2.1 Corporate Social Responsibility

The study sought to establish the role of

corporate social responsibility principles on


transport sector. Most of the respondents

approved to the fact that corporate social

responsibility affects corporate governance in


organizations. This are evident where 39.4

percent agreed largely that corporate social

responsibility affects corporate governance. Of

those responding on economic responsibility,

that 42.4 percent to a very large extent agreed.

When asked whether philanthropic (social)

responsibility affects corporate governance in

the Kenyan public transport sector, 48.5

agreed largely. On ethical responsibility, 40.9

percent agreed largely.


These findings are in tandem with O’Connor

(2005) suggestion on CSR to the individual

owned sector that business should surpass

the solely economic contemplations, and

above sternly legal responsibilities, be

grateful for the social as well as environmental

externalities drawn in its operations, which

include its supply chain. Inclusion of social

as well as environmental issues in the public

procurement looks like it involves a similar

recognition of responsibility by government.

6.2.2 Environmental Purchasing Aspects

To examine the influence of environmental

purchasing aspects on corporate governance in

the Kenyan public transport sector, the study

rated key environmental purchasing aspects in

supply chain management. These included a

design for environment, life cycle approach,

environmental management system,

monitoring and reporting environmental

purchasing activities and encouraging

innovation.

Analysis results on environmental purchasing

aspects indicated that on life cycle approach,

42.4 percent largely agreed that sustainable

procurement influences corporate governance.

When the opinion of the respondents was

sought whether design for environment as a

sustainable procurement practice influences


transport sector, 39.4 percent largely agreed.

On adoption of environmental management

systems as a sustainable procurement strategy

majority of the respondents 40.9 percent

largely agreed. On monitoring and reporting

on environmental purchasing activities, the

majority (40.9 percent) of the respondents

indicated the same. Lastly, on innovation as a

sustainable procurement practice 39.4 percent

largely agreed.

Johanna (2008) argues that as knowledge

relating to environmental damage becomes

more, the pressure to change the methods of

organizations behaviors equally increases,

chiefly among the manufacturing, resources

sectors, and mining supports the findings of

this study, hence supporting the findings by

Avery (2005) that companies need to involve

suppliers in their activities, monitor the

environmental influence of suppliers, and

come up with environmental purchasing

guidelines that intends to lower the

environmental effects of business and their

supplier’s goods, and services.

6.2.3 Responsible procurement Practices

Analysis results on responsible procurement

practices indicated good relationship with

suppliers as a sustainable procurement practice

influences corporate governance in the Kenyan

public transport sector organizations, the

majority (43.9 percent) largely agreed. On

clear and timely communication, that 25.8

percent largely agreed. On sustainable prices,

the majority (39.4 percent) of the respondents

indicated the same. On clear lead times and

payment to suppliers as a sustainable

procurement practice, the majority of the

respondents (37.9 percent) largely agreed on

respect for labor and human rights in the

supply chain, that the majority (40.9 percent)

agreed largely. On support for small and

medium sized enterprises (SME’s) as a

sustainable procurement practice, the majority

(40.9 percent) agreed largely.

The findings infer with Public Procurement

Oversight Authority (PPOA) report (2014) that


public buying in Kenya has been used as a

medium to realize a variety of social goals,

such as lowering unemployment, offering

employment to disabled individuals, youth,

and women and to areas that are marginalized

and other regions in the country, providing

ethnic equality, promoting gender.

6.2.4 Use of Technology in Procurement

On the role of modern technology on

enhancing corporate governance in the Kenyan

public transport sector organizations, 45.5

percent of the respondents indicated that use of

technology has enhanced transparency at KPA.

On accountability, the majority (42.4 percent)

largely agreed. On risk management as a

corporate governance principle, 43.9 percent

agreed to the same in a very large extent. On

enhancing a good working relationship with all

stakeholders the majority (37.9 percent) agreed

largely. On enhancing organization reputation,

the majority (40.9 percent) indicated largely.

On ethical business conduct as a corporate

governance principle, 42.4 agreed largely. On

effective business control environment, 42.4

agreed largely.

The findings of this study are in harmony with

Aberdeen (2005) argument that procurement

experts needs to discover and execute

technology that helps the procurement

procedure and aides the general strategy of the

organization. In fact, the technology needs to

come up with measureable outcomes that are

connected to Return on Investment, which all

about reducing cost of transaction, enhanced

efficient process, a decreased or riddance in

“maverick spending”, improved

transparency, increased contract

compliance, improved inventory costs,

reduced cycle times. Technology is capable of

increasing supplier right of entry to bid

opportunities, which can cause stiff

competition, inclusion, and diversity of

suppliers.

6.2.5 Corporate Governance

The research sought to establish respondents

agreement level with the following statements

in regard to corporate governance in the

Kenyan public transport sector organizations;

corporate governance reduces risk exposure of


organizations, corporate governance enhances

good relationship with stakeholders, corporate

governance enhances compliance with legal

and regulatory framework governing public

sector transport organizations, good corporate

governance improves organization reputation,

and lastly, corporate governance enhances long

term organizations’ sustainability.

From the study findings, 48.5 percent of the

respondents pointed out that corporate

governance reduce risk exposure of the

Kenyan public transport sector organizations

largely; these findings are in tandem with

Drew and Kendrick (2005) argument that poor

corporate governance is a major source of

enterprise risk. On enhancing good

relationship with the stakeholders, the majority

(40.9 percent) agreed largely. On enhancing

compliance with legal and regulatory

framework governing public sector transport

organizations, 42.4 percent agreed largely. 50

percent of the respondents showed that good

corporate governance improves organizations’

to a very large extent while 42.4 percent

agreed to a very large extent that corporate

governance enhances long term organizational

sustainability. International Finance

Corporation (2013) supports the findings of


this study that better corporate governance

increases the probability that the enterprise

will gratify the justifiable claims of all

stakeholders and accomplish its environmental

and social responsibilities. Consequently, it

promotes long term, sustainable growth of

client companies

7. Correlations of Study Variables

Correlation coefficient is known as a solitary

number that describes the degree of the

relationship between two or more variables.

On the other hand, a Pearson correlation shows

strength, direction, and significance of the

bivariate relationship of two variables.

Table 1 below indicated that corporate social

responsibility and corporate governance have

significant and strong positive linear

relationship as attributed by Pearson

correlation coefficient of 0.967 and p-value of

0.000. The correlation matrix table shows

presence of strong and significant positive

relationship between environmental

purchasing and corporate governance

(r=0.862, p=0.000). Responsible procurement

and corporate governance also displayed a

strong, positive, and significant relationship

with a Pearson correlation coefficient of 0.882

and a p-value of 0.000, likewise use of

technology in procurement and corporate

governance had a strong, positive, and

significant linear relationship as attributed by

Pearson correlation coefficient of 0.909 and a

p-value of 0.000.

Table 1: Pearson Correlation

Corporate

social

responsibility

Environmental

purchasing

Responsible

procurement

Use of

technology

in

procurement

Corporate

governance

Corporate social

Responsibility

Pearson

Correlation 1 .862** .882** .869** .967**

Sig. (2-

tailed)

.000 .000 .000 .000

Environmental

purchasing

Pearson

Correlation .862** 1 .927** .854** .913**

Sig. (2-

tailed) .000

.000 .000 .000

Responsible

procurement

Pearson

Correlation .882** .927** 1 .932** .945**

Sig. (2-

tailed) .000 .000

.000 .000


Use of

technology in

procurement

Pearson

Correlation .869** .854** .908** 1 .909**

Sig. (2-

tailed) .000 .000 .000

.000

Corporate

governance

Pearson

Correlation .967** .913** .945** .909** 1

Sig. (2-

tailed) .000 .000 .000 .000

**. Correlation is significant at the 0.01 level (2-tailed).

b. Listwise N=66

7.1 Regression Analysis Results

A multiple linear regression analysis was

done to examine the relationship of the

independent variables with the dependent

variable. The adjusted R2 is the coefficient

of determination. The model summary table

shows that four predictors can explain 96.8

percent of change in corporate governance

namely corporate social responsibility,

environmental purchasing, responsible

procurement, and use of technology in

procurement an implication that the

remaining 3.2 percent of the variation in

corporate governance could be accounted

for by other factors not involved in this

study

.

Table 2: Model Summary

Model R R

Square

Adjusted

R Square

Std. Error of the

Estimate

1 .983a .97 .968 .208

a. Predictors: (Constant), Use of Technology in procurement, Environmental Purchasing,

Corporate Social Responsibility, Responsible Procurement

The results of Analysis of variance

(ANOVA) for regression coefficients are

shown in Table 3. The analysis results

revealed that the significance of F statistics

is 0.00, which is less than 0.05. This implies

that there is a significant relationship

between sustainable procurement practices

and corporate governance. This was done to

establish the fitness of the model used. The

ANOVA table shows that the F-ratio

(F=490.899, p=.000) was statistically

significant. This means that the model used

was appropriate and the relationship of the


variables shown could not have occurred by chance.

Table 3: ANOVA Results

Model Sum of

Squares

df Mean

Square

F Sig.

1 Regression 84.820 4 21.205 490.899 .000b

Residual 2.635 61 .043

Total 87.455 65

a. Dependent Variable: Corporate governance

b. Predictors: (Constant), Use of technology in procurement, Environmental purchasing,

Corporate social responsibility, Responsible procurement

The researcher carried out a multiple

regression analysis to establish the relationship

between sustainable procurement practices and

the four variables. Multiple regression analysis

was used to establish whether independent

variables; corporate social responsibility (X1),

environmental purchasing (X2), responsible

procurement(X3) and use of technology in

procurement (X4), affect the dependent

variable (Y) which is corporate governance.

The model used for the regression analysis was

expressed in the general form as given below:

Y=β0 +β1X1+β2X2+β3X3+β4X4+e

As per the SPSS generated, the established

regression equation was:

Y = 0.64+ 0.494X1 + 0.228X2 +0.201X3 +

0.72X4Where;

Y= Corporate governance

Β0= Constant (coefficient of intercept)

β1….Β4 = Regression coefficients of four

variables

X1= corporate social responsibility

X2= Environmental purchasing

X3= Responsible purchasing

X4= Use of technology in procurement

Based on the regression equation recognized

and when everything is put into account

(corporate social responsibility, environmental

purchasing, responsible procurement, and use

of technology in procurement) constant at

zero, sustainable procurement practices on

corporate governance will be 0.64.

At 5% level of significance and 95%, level of

confidence, corporate social responsibility, and

environmental purchasing significance level

was 0.000, responsible procurement showed a

0.014 level of significant, use of technology in


procurement showed a 0.280 level of

significance and hence the most significant

factors are corporate social responsibility and

environmental purchasing.

Table 4: Coefficient of Determination

Model Unstandardized

Coefficients

Standardized

Coefficients

t Sig.

B Std. Error Beta

1 (Constant) .064 .092 .700 .486

Corporate Social

Responsibility

.494 .062 .510 7.969 .000

Environmental

Purchasing

.228 .046 .239 4.940 .000

Responsible

Procurement

.201 .079 .204 2.534 .014

Use of Technology in

Procurement

.072 .066 .072 1.090 .280

a. Dependent Variable: Corporate governance

8. SUMMARY, CONCLUSIONS AND

RECOMMENDATIONS

The study sought to explore the role of

sustainable procurement practices on corporate

governance in the Kenyan public transport

sector. Especially the study focused on

corporate social responsibility, environmental

purchasing, responsible procurement, and use of

technology in procurement.

The study sought to determine the extent to

which corporate social responsibility,

environmental purchasing, responsible

procurement and use of technology in

procurement affected corporate governance in

the Kenyan public transport sector.

The study findings indicated that a great

influence of the all four variables to corporate

governance. Test of overall significance of all

the four variables jointly, corporate social

responsibility, environmental purchasing,

responsible procurement and use of technology

in procurement ANOVA, at 0.05 level of

significance found the model to be significant.

8.1 Conclusions

The main objective of this study was to

determine the role of sustainable procurement

practices on corporate governance in the

Kenyan public transport sector. From the

previous studies, the components of sustainable

procurement practices were expected to have

positive relation with corporate governance.


The output of the findings shows a significant

positive relationship between the components of

sustainable procurement practices namely

corporate social responsibility, environmental

purchasing, responsible procurement, and use of

technology in procurement with corporate

governance.

About corporate social responsibility, the

findings revealed that Kenya Ports Authority

considers corporate social responsibility as an

integral part of its core values. The results

revealed that corporate social responsibility

affected corporate governance at KPA. The

results have also shown that corporate social

responsibility (β=.494, p=.000) positively and

significantly affected corporate governance at

KPA.

The study also showed that Kenya Ports

Authority support environmental purchasing

principles in its supply chain management

activities largely. The results have revealed that

environmental purchasing affect corporate

governance at KPA. Environmental purchasing

(β=.228, p=.000) was also found to positively

and significantly affect corporate governance at

KPA.

The study establishes that responsible

procurement at Kenya Ports Authority’s supply

chain has been achieved by a great extent. The

results have revealed that responsible

procurement affect corporate governance at

KPA. Responsible procurement (β =.201,

p=.014) was found to positively and

significantly affect corporate governance.

Lastly, the results revealed that use of

technology in carrying out procurement

activities at KPA has been achieved largely. The

results have revealed that use of technology in

procurement slightly influences corporate

governance positively at KPA (β = .072),

however its value is insignificant (p= 0.280).

8.2 Recommendations

From the study, various recommendations are

being made concerning policy and procurement

practices. Continued increase in pressure on the

environment warrants sustainable outcome for

the earth. It is important for public institutions

in Kenya to use sustainable procurement

programs. The legislature should come up with

laws that administrate sustainable procurement

as well as laws that are capable of improving

compliance.

On corporate social responsibility, the study

recommends that there is a need for public

sector organization to develop a good policy and

tools for monitoring and evaluation of CSR

activities within the organization and its supply

chain. One of the critical success factors for

implementing sustainable procurement in

organizations is to formulate, communicate, and

enforce effective corporate sustainable

procurement policies in alignment with

corporate strategy for sustainability and CSR.

On environmental purchasing, the study

recommends that sustainability aspects to be

considered in the whole procurement cycle i.e.

from need identification to procurement contract

close out. This would ensure that public sector

organizations carry out business only with

suppliers or organizations, which meet pre -set

sustainability standards.

The study as well recommends that public

organizations’ departments needs to increase

uptake of training on sustainable procurement.

For instance, procurement staff needs to receive

detailed training on the benefits of having

sustainable procurement and the best ways of

carrying out sustainable procurement in


practice. Senior management need to be taken

through training to enhance high-level buy-in

towards sustainable procurement within the

department. Some of the staff members who

have the responsibility for developing business

cases for procurement should as well receive

training on how to replicate sustainability in

their procurement proposals. Departments

should equally make sure that procurement staff

is decentralized purchasing teams obtain

sufficient training in sustainable procurement,

and ensure that these teams stick on to the

policies and standards taken up by central

procurement teams.

8.3 Areas for Further Studies

This study was confined to the public transport

sector and focused on four major sustainable

procurement practices namely; corporate social

responsibility, environmental purchasing,

responsible procurement and use of technology

in procurement. This limited the study from

exploring other sustainable procurement

practices that still could influence corporate

governance not only in public sector

organization but also in the private and non–

governmental organizations. The study,

therefore, proposes further studies to be carried

out to help in establishing other sustainable

procurement practices that affect corporate

governance in other economic sectors in Kenya

that were not covered in this study.

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